R.I.P. Digital Advertising: Customer Acquisition Is Now A CX Game

 

                                       Image source - How to create a great customer experience | by Kyle Drewnowsky | Ablii | Medium

This article discusses that digital advertising should focus on the overall customer experience (CX) versus acquisition alone.  It suggests that a better approach to customer acquisition is finding ways help prospective customers move along the customer journey as a way to improve ROI and CLV. 

As we learned in class, customers tend not to respond to advertising campaigns that are intrusive or obnoxious. The article argues "more advertising, even better advertising, rarely results in more customers or revenue. But improving CX can." And states that focus solely on new customer acquisition is missing opportunities. CX is proving to be a far more effective growth strategy with significantly better ROI. 

This is a good point, however digital advertising is here to stay. It is designing the ads and ad campaigns effectively in order to draw customers in across the customer journey that makes the difference.

Article Source: R.I.P. Digital Advertising: Customer Acquisition Is Now A CX Game (forbes.com)

Don't Mock the Metaverse

The Economist argues that despite the ham-fisted launch of Meta and some of the mocking that ensued, we should be taking it seriously.  Something like the Metaverse is a natural extension of both sophistication in hardware, software, and artificial intelligence, and a three-dimensional internet is the logical next step from where we are now. They cite the examples of Everquest, World of Warcraft and now Roblox as three-dimensional locations in which people live and play - not so much work - but which have millions of users.

Meanwhile, Shaan Puri on argues on Twitter that we're thinking about Metaverse wrong - and we shouldn't be thinking about it as a place, but as a threshold in time that we are inexorably moving towards - where our digital lives are more important to us than our physical ones.  We are already cultivating our digital selves with filters, and with the introduction of phones our level of attention on the physical environment around us has dropped to 50%. Puri foresees a time when 90% of our attention is on screens and believes that that is when the Metaverse will truly exist.

The implications for digital marketing are of course enormous - with so much attention on screens, opportunities to respond to intent and interest are only going to multiply and accelerate. It is no surprise the Facebook is betting big on this, followed by Microsoft and nVidia - it is not 'weird' - it is simply about positioning their companies to be ready to capitalize on where the world is headed.

The question is how digital marketing will be welcomed in this new world. In class last week we heard from a speaker who offers value exchange advertising on mobile, who despaired at how poor marketing placements in virtual environments were being both executed and received. My personal favorite, Nine Inch Nail's nail-gun ammo box in Quake, has rarely been beaten, and it's now over 25 years old.

Rethinking Digital Ads for the Holidays

https://www.cnbc.com/2021/11/11/how-retailers-are-rethinking-their-approach-to-marketing-this-holiday.html

DTC companies (and companies heavily dependent on digital advertising) have certainly been on a roller coaster ride since the pandemic. We all saw firsthand how DTC companies blew up overnight as everyone sheltered at home and constantly scrolled through Facebook and Google. Major companies (airlines, hotels, etc.) also pulled back ad spend in particular on Facebook in a play to conserve cash which caused companies to score top advertising real estate online for a lot less money. Then came 2021 and post-vaccine as life slowly came back to a sense of "normalcy," rates started to creep back up and as noted in the article, CPMs continue to skyrocket tracking 50% increases to CPMs on Facebook with an additional 50% anticipated. Coupled with people spending less time on screen as the world continues to slowly open up - "An analysis by the market research company eMarketer found that users in the U.S. are expected to spend less time scrolling through Facebook this year and in the coming years. Time spent on the platform for adults over the age of 18 is expected to be down 3.3% in 2021 compared with 2020 levels, eMarketer said. It forecasts it will drop another 1.8% from 2021 to 2022, and fall another 0.7% in 2023." - means a double hit as cost increases and eyeballs decrease. Then, finally comes around Apple's privacy changes in April impacting how app track users and Meta facing scrutiny after a whistleblower, Frances Haugen, released a trove of damning documents, has caused many companies to pull out of digital altogether such as Patagonia. Other companies who continue to have a prevalent Facebook presence have seen their performance dovetail dramatically and coupled with Apple's privacy initiatives to the point that companies are beginning to think about their digital strategy which may be a complete opposite of the strategy one-year ago. Will be very interesting how this all shapes up as we head into the holidays!

Budgeting Apps

Thinking about what to write for the blog, a discussion that was going rounds in our EMBA WhatsApp group chat was which budgeting app is the best one to be used. A lot of apps were shared including one that had a New York Times article to back it up however for someone who is kind of old school in managing the budgets I saw some advantages and some disadvantages of using a Mobile Budget app and hence came the topic of my blog.

I want to lay down some pros and cons here for the Budgeting app but ultimately you must do what suits you best and is less risky especially when it comes to sharing your financial information. Diving into the pros of budgeting app the first one is the ease of set up. Signing up for a budgeting app is as simple as verifying your email address and linking your financial accounts. How many accounts you have will determine how quickly you’re set up and tracking your economic life. The second is accessibility, the online budget tool comes with a mobile app, so you’re never more than a few taps from checking your financial health. Apps like Mint, You Need a Budget, and Clarity Money in particular offer easy-to-use dashboards and mobile experiences. Setting long-term visible goals is another benefit of the budgeting app. Budgeting apps break down your overall net worth, debts, savings goals, and other metrics that let you know where you always stand. These details may seem like common sense, but plenty of user reviews of debt settlement services like Freedom Debt Relief would tell you otherwise.

On the other side, the cons include some major concerns like most budget apps offer the simplicity of integrating with all your financial accounts and consolidating your activity into one dashboard. However, to get accurate analytics and forecasts, you’ll probably need to do some tweaking. Mint, for example, promises to categorize your spending automatically. But unless their predefined categories work for your budget, you’ll have to create your own sections and review your monthly transactions to ensure they’re being labeled correctly. Also, A budget app can tell you how much you’re spending each month, how far over-budget you are, or your progress with savings goals but it won’t make decisions for you. If you can’t carry out the plan a budget app lays out, you might have more success with the cash-envelope budget. This method gives every dollar of monthly income a destination by putting cash in different spending envelopes. People are starting to realize that using free products carries drawbacks, namely the fact that if the product is free, the user is the product. This is no different with free financial apps, which usually serve a lot of ads and “personalized” recommendations for banking products and institutions advertising on the platform. Last but in my view most critical is the security risk. using online budget apps means one more account for a cybercriminal to hack potentially. This is less a reflection on the companies providing these apps and more in tune with the realization that cyberattacks cannot be prevented, they can only be minimized. That’s why if you do use an online budget, make sure to use a secure password manager to store your login.

At the end of the day, budget apps will be as effective as the person using them. If you need an accessible system that’s easy to use and gives clarity over your situation, then a budget app will probably do wonders for you. But if you’re looking for an app to solve your mindset, never need any fine-tuning and pose no security risks or data sharing.

More advanced sales techniques are coming to mobile gaming

In the past few years, mobile gaming sales tactic has become a lot more sophisticated. It used to just be a simple pop-up asking if you have interest in purchasing things that you need at a discounted price. Nowadays, the CRM tools can fire specific pop-ups to people based on their demographic data or more likely some very specific behaviors done in the game. For example, if the game data shows that a player plays a lot more of a certain game mode, it will fire a discounted sales bundle for resources particularly targeted for playing that specific game mode. Payer / non-payer targeting would be another big one.

There are also a lot of innovations happening in the sales design. One example is that similar to retail, there is usually a "hangover" effect after a big sales of virtual currency - meaning that payers won't buy for quite sometime since the virtual currency gain from the sales will last them for a while. Sometimes, we don't even know whether doing sales would be more beneficial compared to not doing sales since the "hangover" from sales might outweigh the gain. One new technique to combat this problem is to show the players that the discount they get depends on how much currency they currently have. For example, if they have 0 currency, they will have the biggest discount. Doing it this way has the potential to significantly reduce the accumulation of currency after purchase to very effectively reduce the "hangover" effect.

Apple v. Amazon, what?

Actually, its not that big a surprise. I wanted to learn more about how was been negatively affected by Apple's privacy changes versus who might actually benefit (or, as is often the case with regulatory changes, who is least affected). 

It turns out Amazon wins out - AGAIN. The reason is simple, it relies on its warehoused data. But even further, Amazon is utilizing (or aligning) two clients through its market place: willing buyers and eager sellers. And like a true exchange earns via facilitation. 

Contrast this to Facebook or Snap, et al social media networks, where the "service" is free but the product is the monetization of client data. These company's, as has been amply covered in the media, are far more reliant on iOS for tracking, especially across apps. 

Another potential winner by reduction, i.e., weaker competition from social media networks, is Google. Their platform has both targeted and more generalized ads AND obviously a rich dataset from its inhouse products which are often utilized by its users on PCs, i.e., not affected by iOS changes. 

Finally, Apple is a winner. Reputation seems much more important than being seen as catering to the likes of Facebook. This is a great move by company who derives most of its revenue from its outstanding portfolio of B2C products.

https://www.reuters.com/technology/amazon-seen-triumphing-over-apple-privacy-changes-digital-ad-business-2021-10-27/

Digital Marketing through livestreaming

Livestreaming is a new tool for televison broadcast, video games and other media activities in recent years. At the beginning of the presence of livestreaming, it is common that streamers use this tool to share what they are doing like playing games or travelling. At present, livestreaming is implemented and it also becomes an efficient tool for digital marketing.

In China, many influencers from tiktok use livestreaming for products selling and brand advertising. November 11th, the most important date in a year for Chinese customers to shop. The brands cooperate with influencers to provide attractive discounts for livestreaming. The most famous influencer, Jiaqi Li could make billions CNY turnover by livestreaming during this important shopping day. 

Livestreaming is primarily about creating a connection between the potential customer and the product. Implementing live streaming in digital marketing strategies is more positive than our imagination. Some studies even claim that 90% of potential customers get more confidence in the information conveyed by a video, when purchasing a product or service. Hence, the reason why live streaming is becoming one of the bases for online sales strategies.

In the US, Some of the most used platforms are:

• Facebook Live
• Instagram Live
• Twitter Live
• Youtube Live

Being able to use these platforms for your next strategy, can lead to generate great benefits for the brand, such as:

• Positioning you ahead of your competition
• Increased organic reach
• Faster sales process
• Greater engagement with your audience
• Humanize the brand
• Reach your audience
• Increased brand visibility and interactions
• Accelerated lead generation
• Growth in organic traffic

Reference:

Livestreaming and the power of live digital marketing. 

https://www.liftingroup.com/en/live-streaming-on-marketing-strategies/ 

New Shopping Features on Facebook: Shops in Groups, product recommendations, and live shopping for creators

 Today, Facebook announced that it is launching three new shopping features: Shops in Groups, product recommendations, and live shopping for creators. Shops in Groups essentially allows Facebook group admin to set up an online store on his/her Facebook group page. This provides an opportunity for group admin to make money and support his/her efforts to maintain and engage his/her Facebook group. This to me is also another approach for Facebook to maintain its active user base, as the number of young users in the US continually declining. Facebook previously launched the Shop function. Product recommendations and live shopping further build on its current shopping offering. These new features will most likely boost the holiday shopping sales via Facebook platform. Social commerce is a vastly growing business. It turns the shopping to a social experience. Social network is also where young generation (Millennials and Gen Z) like to shop and they trust their social network far more than seller’s advertisement. With more scrutinies on data privacy and targeted advertainment, social commerce will be one of the key emphasis for Facebook in the future. 

https://techcrunch.com/2021/11/12/facebook-launches-shops-in-groups-and-live-shopping-for-creators/

How Zapier Acquires Customers via Its Homepage

As we are learning about a number of tools available to efficiently market products and services, a recent TechCrunch article delved deep into how a company's own website can be a great marketing tool to acquire customers. The company being analyzed was Zapier (www.zapier.com), an application that was built to connect multiple web applications to one another seamlessly. A few key takeaways from for building a website that promotes conversion were:

1. Grabbing attention early on the homepage with tactics such as (i) a descriptive header with no jargon (ii) a sub-header that outlines the transformative journey a customer goes through by using your product (iii) a call-to-action that promises a similar transformative journey as a result of using the product

2. Social proofing to boost your firm's credibility. i.e highlighting the names/logos/testimonials of any well-known companies that use your product. 

3. Clearly describing the benefits each feature provides your customers. Framing features as benefits further encourages users to sign up. 

4. Construction a simple pricing section that doesn't frighten any prospects. Experience has showed that a transparent pricing section (cost, benefits, restrictions etc) are highlighted so that customers know upfront what they are getting for what they are paying. 

5. A final call to action section that highlights a sense of urgency to use your product and reiterating social proof by mentioning how many customers are already using your product and why its important that they do so as well.

 https://techcrunch.com/2021/11/11/demand-curve-how-zapier-acquires-customers-via-its-homepage/

Will Digital Marketing be Worth It This Holiday?

The news this holiday has been all about America’s massive supply chain disruption which has retailers warning shoppers to buy early as they expect inventory issues.  This back up in the supply chain which has inventory sitting in ports with no way to get to stores and warehouses, has of course led to an increase in prices due to the limited supplies. But there are other rising costs that also have retailers worried this holiday, specifically the costs of digital marketing.  In this article, the author highlights many of the issues with digital marketing this year compared to years past such as Apple changing privacy policies, the expected drop off in Facebook usage, and the consumer behavior changes coming out of the pandemic. 

Last year, during the pandemic, companies in the travel industry, for example, avoided paying for digital marketing advertising on social platforms and other sites to conserve cash during uncertain fiscal periods and to avoid coming off as insensitive during a difficult time.  This left prime advertising real estate during the holiday for other retailers who ended up seeing successful returns on their digital ad spends. However, this year, like the increasing costs from the supply chain issues, digital marketing costs are also increasing. Last year, with people stuck at home scrolling through media and social platforms, advertisers had a captive audience that may not be there this year.  With this almost full return to normal post-pandemic life and spending habits, retailers will have to be smarter with their ad spend. 

This may mean that targeting and content will play a bigger role in digital advertising this year.  As prices increase retailers will want to get their messages to customers with whom they will resonate the most and see the best ROI.  Some retailers are tweaking campaigns to state their inventory positions amidst all the supply chain concerns with messages like “ready to ship” and are starting their advertising blitz earlier.  Other retailers are waiting on goods to arrive to start their blitz of holiday campaigns.  With all these rising costs for companies this holiday season, it will be interesting to see how it impacts revenues during a time that most retailers see their largest revenue gains.  

Nike Keeps Doing It

With 300 million members enrolled in their insanely popular NikePlus program (side note: they were one of the very first to roll out the 'plus' addition to their name), Nike continues to find ways to personalize content to keep the customer coming back for more. Not only are they using specific purchasing behavior to tailor promotions to increase loyalty but they have now enlisted superstar power to tailor content. One such example is their partnership with Megan Thee Stallion in which connected users who listened to the content created through the collab to apparel that featured her. The brand keeps finding ways to connect other aspects of their customers lives (music and fashion) to the things it does best (content and workouts).

In another move that leverages their digital success, Nike has gone brick and mortar to grow customer engagement. With the opening of their Nike Live store in Williamsburg, Nike hopes to capitalize on the high digital engagement in the area by creating an outlet that gives those customers a physical touchpoint that is tailored to the demographics and preferences of the surrounding community. All that data gathered has enabled Nike to specifically create experiences that their customers crave: something uniquely for them. 

All this is to say that Nike is continuing to crush it...and I haven't even touched on Nike's preparation for the metaverse. 

Sources:

• https://www.marketingdive.com/news/how-nike-execs-think-through-its-digital-ecosystem/609965/
• https://www.cnbc.com/2021/11/02/nike-is-quietly-preparing-for-the-metaverse-.html

Maximizing Video Strategy Through Social Platforms

Before the COVID-19 pandemic, choosing video as the right way to market a brand or business was debatable.  And now after a year of staying indoors and working from home, shoppers have moved online during the pandemic.  It’s not surprising to see the strength in e-commerce and acceleration towards video e-commerce marketing, in particular.

For years, retail companies have been trying to get consumers comfortable with the idea of buying something without being able to physically touch, see or try on clothes.  However, in the past year and a half, many consumers did not have a choice. 

A few companies that really have taken advantage of this growth is Amazon and YouTube.  Amazon has a capability that enables consumers to add products from video ads to their Alexa shopping lists. YouTube has launched video action campaigns that allow viewers to send a website link in an ad to their phones.  The shift of e-commerce is helping people save time and soon AI powered methods will be adopted by the majority of companies. 

The question now is when will consumers buy clothing from a video ad shown on Instagram?

https://www.marketingdive.com/news/institutionalizing-change-whats-ahead-for-agencies-in-2022/609647/

Five Digital Marketing Predictions For 2022

This Forbes article was insightful, the two points that stood out for me were 2) The Power of AI and 3) Content. Even though the digital marketing industry currently utilizes AI, the author predicts we will see a growing number of companies implement AI into their digital marketing strategies. A few areas that were highlighted were SEO and SMM, companies can use AI to automate and streamline these processes. In regards to content, the article discusses that businesses should focus energy optimizing content for voice commands on devices such as Siri and Alexa, in order to improve performance as consumers shopping preferences continue to change. https://www.forbes.com/sites/forbescommunicationscouncil/2021/11/09/five-digital-marketing-predictions-for-2022/?sh=29cd7bb164f5

 Facebook *ahem meta* Responding: Tell Us What You Don't Want so we can Target you Better

This week Meta Platforms (f.k.a. Facebook...side note: does the name change remind you of Metta World Peace) announced that it would allow users to avoid being targeted with ads regarding certain topics like gambling or weight loss. These persistent advertisers are endemic examples of the abuses of digital marketing - pestering users, playing with their sense of self-restraint and self-worth, until they succumb to clicking on the ad and spending their hard-earned money on another scam.

In the short-term this move will likely hurt Meta's revenue only very slightly - these spots will be placed with other advertisers willing to pay just-about-as-much and only a small fraction of users will actually take the effort to choose to opt-out. Further, aren't the people who opt out less likely to click on the ad anyway??  This should give targeting this user group a higher CTR (and likely higher conversion rates once on the advertisers' sites) and thus a greater value to Meta (and the advertiser). 

The skeptic in me wonders whether Mark Zuckerberg has already done the calculus to know that in the medium term the increased data from users opting out of receiving these ads will more than offset the short-term loss in revenue given this new and unique data source incremental to what is already being captured by Meta.

The fact that when Meta makes a seemingly-altruistic decision to reduce some of the excesses on its platform, I immediately think about the broader narrative and assume there is a profit motive at play speaks to the loss of trust that Meta is suffering from across many parts of its business - from regulatory concerns, to user attrition, to partners flocking to other platforms.  How long will this loss of trust endure?  Will Stella (ahem Meta) get her groove back?

Trying to distract us with name changes and token sacrifices (that may not actually be sacrifices) is akin to a Hoodini trick / Kansas-City-Shuffle / bait-and-switch but will not restore trust. Only actually being trustworthy and making many good decisions over the course of multiple years can do that. Maybe Mark and Meta should try it.

Source: https://adage.com/article/digital-marketing-ad-tech-news/facebook-ad-changes-restrict-abusive-targeting-can-limit-weight-loss-and-gambling-ads/2379356

The Everchanging Digital Marketing World

https://searchengineland.com/what-digital-marketers-should-know-about-google-analytics-4-375863

I found this article to be extremely fascinating at the speed in which the digital marketing world is changing, which is essentially almost on a daily basis. What we may have learned in this class today may not even be relevant two weeks from now, which is exactly what the article discusses with the imminent change to Google Analytics 4 which is a completely new version of Google Analytics. While at the same time invigorating for those in the digital marketing space given the changing nature of the ecosystem (always having to stay on your toes), also extremely frustrating at the same time! I also found it interesting how Google Analytics 4 is providing a laundry list of features to ensure marketers are adhering to latest regulations around privacy (thereby making their jobs that much harder). Google is taking a giant step to transition the world into incomplete data where reliance is not as heavy on cookies which will be very interesting to see the ramifications such as the iOS 14 update as it reverberates across businesses (especially those very much tied to DTC). 

TikTok Publishes New Holiday Campaign Planning Guide for Marketers

TikTok is ramping up its promotion of holiday ad campaign planning for marketers. It offers an in depth 16-page planning guide which shares best practices to promote products and services to TikTok users. They recommend starting early and beginning planning 3-4 weeks in advance and even provide holiday templates. This platform can serve as an effective social media platform to roll out ad campaigns on for Gen Z populations especially given its popularity within this demographic.

Article: TikTok Publishes New Holiday Campaign Planning Guide for Marketers | Social Media Today

Surprise Surprise, Google found anticompetitive

 https://www.wsj.com/articles/google-loses-eu-shopping-ads-case-appeal-11636539480?st=ezj3g1wp6x9elvq&reflink=desktopwebshare_permalink

After a contentious battle, the EU General Court's commissioner for competition, Margrethe Vestager, has won a case against Google (or, as we are prompted to refer to the company now, Alphabet...) The findings of a 2017 antitrust probe were largely confirmed through the ruling, meaning that Google will face a charge of 2.8 billion dollars.

What did Google do wrong? According to the case, Google's search engine had functioned in a way to thwart competition by favoring its own comparison-shopping advertisements. Surprised? Not really - Google's business model has since day 1 prompted critics to think about competition in a new light, especially as it relates to the internet and online market places. 

That being said, the ruling is a nod towards the direction that governing bodies like the EU General Court would like to continue towards: regulating big tech. Ms. Verstager's efforts to protect competition will be in full force as the EU currently debates the online-competition bill called the Digital Markets Act. The bill in a nutshell would protect smaller players from being undercut by large tech giants in acting more favorably towards their own products than those of the third parties.

All in all, an eventful week in Big Tech! Watch this space...

Has the Pandemic Really Accelerated Digital Marketing Trends?

Jessica Hawthorne-Castro of Adweek argues that not only has the pandemic accelerated remote work and our adoption of delivery and home-based services, it has also accelerated digital marketing trends by up to a decade.

Her belief is that although millennials and younger generations were already online and using mobile to high degree, the experience of being homebound for months pushed older generations online to a greater degree for entertainment, work and social interactions. "Favorite engagement points included online video, pay-per-click advertising, social, CTV/OTT, sponsored content, mobile and email," she says.

Though she provides no evidence for this hypothesis, this is not an unreasonable supposition. More people at home means more people online. However, Hawthorne-Castro does not acknowledge the impact of the Apple's recent privacy changes and the threat of regulation from government.  Apple's changes alone significantly impacted Snapchat's reported earnings and share price, taking other social media giants with it.  

But Facebook and Google and resting on their laurels, and are beginning to develop alternative approaches to reaching targeted audiences without relying on cookies and targeting individuals.

However, in my opinion, this could actually drive up barriers to entry into offering digital marketing solutions, removing new entrants, and thus creating a situation where there is less innovation, because there is less competition. So my counter question is, have trends been accelerated, or have privacy changes and the threat of regulation entrenched a duopoly that might result in a decline in innovation in digital marketing overall?  

Time will tell.

cigarette tv advertising is back!

 https://www.theonion.com/marlboro-sneaks-back-into-television-advertising-with-1847954837

Great timing with our Philip Morris case in the 'Economics of Strategic Behaviors' class too. For the longest time (50+ years), cigarette advertising has been banned on tv. But recently, a Marlboro commercial 'ran at 3:30 a.m. on a cable channel and featured a new iteration of the iconic Marlboro Man'.

This is an attempt to help the struggling tobacco industry as cigarette consumption per capita declining for many years. It will be interesting to see how regulators react to this attempt. Have they 'let their guard down' after many years? Or will this ad be successfully?  

Finding Amazon Explore - Beta

Recently while shopping through Amazon, I came across Amazon Explore (Beta) which to me was such an amazing thought (why didn’t I think about it though!!!) it blew me away. It is still the beta version but works perfectly well and in my opinion, is an amazing idea considering the lack of travel in the current age. Even if the travel goes back to normal times, still this platform will remain relevant for those who cannot afford it or who don’t have the time to cross out the bucket list places in the list. The site goes with the caption of “The World, At your fingertips” and it literally is. It is a live stream service that allows interactive live streaming services to discover new places and at the same time helps you Shop!! The way it works is that there are places offered on the site for different charge amounts. You schedule on the sit and then connect with the host around the world on the agreed schedule to explore those landmarks with private guided tours and make purchases, all from the comfort of your couch. The two-way stream lets you interact with the host in real-time. You can purchase the items you find on your way that can be shipped to you and the host will give you the local inside facts that are unique to the place. Whether you want to learn, explore a new place or get a new skill, everything is available. So go ahead and start using the Amazon Explore platform, I have already booked 4 sessions and counting 😊 !!